Credit without proof of wages – difficult or not?
It is very difficult to get a loan without proof of wages. Otherwise, this would mean that the banks would issue a blank check to their customers and would have no guarantee that they would see all or part of their money again. Even if you grant a loan to a person who does not have a permanent position but is self-employed or freelance, it does not mean that this is a loan without proof of wages.
Loans for the self-employed and freelancers
Self-employed and freelancers who have found a suitable lender must submit different documents to the bank than most employees. The bank will inform the customer of the relevant documents when submitting the application. Depending on whether a commercial or a freelance activity is carried out, it can be the profit and loss account, the income excess account or the business accounting, which is also known as BWA.
Using these documents, the bank or the private lender can get an accurate picture of whether the applicant has enough income to make a living, make operational expenses and also pay regular loan installments. If this is the case, the loan is quickly granted and can be paid out within a few days.
Loans for the unemployed
Unemployed people can only get a loan without proof of wages if they can present a co-applicant, guarantor or other security to the lender. Unemployment benefit is a regular income, but due to the fact that it is a social benefit, it cannot be seized and therefore cannot be used as security for credit.
For long-term unemployed the situation is even worse. After just one year, they slide into the Social Welfare cover, with the result that they have to restrict themselves financially even further. The Social Welfare benefit is also so scarce that it leaves absolutely no scope for any extras or for payment of credit installments. There is one important exception to this, however.
All Social Welfare recipients who find themselves in a special emergency can get an interest-free loan from their local job center. Such a loan without proof of wages can be granted not only in the case of long-term rental or energy debts, but also in the case of a defective refrigerator, a defective washing machine or in comparable cases.
The responsible employee in the job center will examine the loan application very carefully and will only grant approval if there are serious reasons that cannot be postponed. The loan without proof of wages must be paid back to the job center in monthly installments.